Rescuers searched Loch Broom in Wester Ross for two hours, fearing she had fallen from the Stornoway to Ullapool CalMac ferry.
The woman, in her mid-50s, was spotted on the vessel, the MV Isle of Lewis, at 4.20pm at the entrance to Loch Broom on the mainland.
When the ship docked at Ullapool almost an hour later, her bicycle was found on the car deck but there was no sign of her.
Stornoway and Lochinver lifeboats were launched and the coastguard search-and-rescue helicopter was also sent to scour the area.
Several local boats and the Scottish Fisheries Protection Vessel Jura joined the search for the woman and Ullapool coastguard and police officers were also involved.
But the alert was called off after it emerged she had merely decided to leave her bicycle to catch a bus to Inverness, and police traced her to the city's youth hostel.
A spokeswoman for Stornoway Coastguard said: "The woman has been found in a youth hostel in Inverness. It has been quite an involved and expensive search."
In a statement, Northern Constabulary spokesman said: "The passenger was later traced safe and well in the Inverness area and all agencies were stood down."